Yep, kids will want this system, they get handed down the old tv to play their games on it, it happens all the time (I owned a company who built and installed custom home theater PCs and saw this a lot). A lot of people still have a SD TV, some with composite and others with component HD. Why ? If it still works, why replace it ? Most CRT based TVs from 10 years ago, still work fine and it's proven over 10 years they will lose only about 15-20% of brightness.
To all the people who worry about not being able to use this system on a older TV, I would put money down that there will be an adapter of some type to connect that old analog tv. Even if Microsoft does not make it (there are adapaters out already to convert non HDCP HDMI connections to analog tvs).
To all those people to who say just replace, did you know some of the best projectors in the world are CRT based that are ANALOG ? A computer based CRT projector ($25K+ when new) from 10 years ago will display 4K res. Your fancy $350 LCD 50" tv would not even get close to it.